"A bank employee would first set up a bogus corporate account using a stolen corporate identification and the required personal identification to set up the account," the whistleblower explained. "The loan request would go to HSBC underwriting in Buffalo and the loan would get approved, often on the basis of fraudulent tax returns and fraudulent documentation to support the loan."

HSBC reportedly is under investigation by a U.S. Senate committee, and WND has provided material to federal investigators.

Cruz said the scheme relied on corporate and personal information selected by identity theft to give the fraudulent account a sufficiently good credit history to justify the loan, even though all the supporting documentation, including tax returns, was fraudulent.

"Even when these fraudulent loans were declined, HSBC employees in on the scheme would simply call senior bank executives to have the loans approved, thereby effectively by-passing underwriting.

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Exhibit 1 is a HSBC list of fraudulent bank loans made by various employees, all of whom used the same bogus USER ID here redacted as 433***36. All customer and bank employee information has been redacted from this report to respect privacy restrictions.

Each line item in Exhibit 1 represents a different loan made to a different fraudulent company.

Cruz noted that all of the Social Security numbers are legitimate numbers used by the HSBC identity thieves to establish the account.

"None of companies listed were functioning companies, and the loan files lacked critical documentation including source of repayment," Cruz said.

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The whole point was to steal hundreds of millions, if not billions of dollars from HSBC itself, Cruz alleged, through the fraudulent loans drawn from bank income. As a result, the net earnings of the bank were depressed and the loan loss transferred to the shareholders once the loans defaulted.

"Once the loans were made, checking accounts were established by HSBC employees for the fraudulent corporations, and the loan proceeds were transferred into the corporate accounts," he explained. "Once the loan funds were in the fraudulent corporate accounts, HSBC employees in on the scheme could wire the money out of the accounts to locations not recorded in the account bank statements."

Exhibit 2 is another HSBC internal bank record documenting fraudulent loans. The user ID of the bank employee making the loans is again 433***86, a number multiple bank employees utilized when setting up bogus corporate accounts for fraudulent loans.

Every time Cruz saw suspicious loan activity, he reported it – through emails, faxes and telephone calls.

When he realized his reports with senior management and bank security were being ignored, Cruz began wearing a wire so he could record conversations with bank employees in which the discussions confirmed their awareness of the fraudulent activity and their unwillingness to do anything to stop it.

He also began printing out reports documenting fraudulent loans and keeping a record of his emails that he could remove from the bank location for safekeeping.

Exhibit 3 is a memo Cruz wrote in his attorney's office shortly before he was terminated by HSBC, to be sent to his direct management supervisor at HSBC.

In the memo, Cruz explained the methodology in which fraudulent loans were being created by HSBC employees. He also detailed his efforts to bring the information to bank security officers.

The names of the bank officers discussed in the memo have been redacted to respect privacy.

Exhibit 3: John Cruz memo to HSBC bank management

"The only result of the memo was that the bank took disciplinary action against me," Cruz said. "I reported the fraud, and I was reprimanded for not bringing in more business. I was told that my job was not to report fraud, but to bring in more business. Since I refused to bring in new business from fraudulent accounts, I marked myself for termination."

In February 2010, Cruz was terminated from HSBC for poor job performance; he had been at HSBC since January 2008.

After leaving the bank, Cruz attempted through his attorney to turn his information over to the Department of Homeland Security.

"DHS didn't even respond," he said. "We didn't get as much as a letter from DHS, despite the repeated calls and emails my attorney made to DHS in the attempt to get their attention."

Cruz has no idea how much money went through HSBC in fraudulent loan activity. The amount that he observed and was not able to print out ran into the billions of dollars, he estimates.

"Every day I went to work, I began to wonder how many fraudulent accounts I would find that day," he said. "But every time I found something suspicious, the reaction I got from bank management and bank security was, 'Shut up and do your job.'"

Jerome R. Corsi, a Harvard Ph.D., is a WND senior staff writer. He has authored many books, including No. 1 N.Y. Times best-sellers "The Obama Nation" and "Unfit for Command." Corsi's latest book is "Partners in Crime."